by Russell Noga | Updated August 24th, 2024
Are you preparing for the Family Life Medicare Supplement 2025 changes? This year, pivotal adjustments will take place – from behavioral health service enhancements to new cost-sharing structures. These changes are set to shape not just your plan choices but also your out-of-pocket expenses and benefits. In this article, we’ll guide you through these updates, ensuring you have the necessary information to make the best decisions for your family’s healthcare needs without overloading you with unnecessary details.
Key Takeaways
- CMS changes to Medicare Advantage and Part D plans for 2025 focus on improving healthcare quality and affordability, including enhanced access to behavioral health services, cost-sharing limits for D-SNP PPOs, and mandatory annual health equity analysis for utilization management policies.
- New initiatives for chronically ill enrollees involve Special Supplemental Benefits for the Chronically Ill (SSBCI), measures to improve benefit awareness such as ‘Mid-Year Enrollee Notification’, and expansion of the Federal Low-Income Subsidy (LIS) Program to aid more beneficiaries.
- Prescription drug reforms include a new monthly payment option for out-of-pocket costs, a $35 monthly cap on insulin, a $2,000 annual cap on out-of-pocket prescription drug costs, and smoother payment systems, which all aim to reduce financial strain on Medicare beneficiaries.
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Key Changes to Medicare Advantage and Part D Plans in 2025
The year 2025 marks an important year for Medicare Advantage and Part D plans as the Centers for Medicare and Medicaid Services (CMS) introduces key changes aimed at improving the quality of healthcare and reducing the financial burden for Medicare beneficiaries. One of the significant changes includes enhanced access to behavioral health services, which aims at broadening the scope of mental health care for beneficiaries. This is coupled with the introduction of cost-sharing limits for D-SNP PPOs, which seek to limit the out-of-pocket expenses of beneficiaries enrolled in these plans.
Additionally, an annual health equity analysis will be required for Medicare Advantage organizations to ensure all utilization management policies are fair and equitable.
Enhanced Access to Behavioral Health Services
Aiming to enhance mental health services, Medicare Advantage plans are introducing a new facility-specialty type, ‘Outpatient Behavioral Health’. The new category will cover a wide range of behavioral health professionals, including:
- Marriage and Family Therapists
- Mental Health Counselors
- Addiction medicine physicians
- Community Mental Health Centers
- Opioid Treatment Program providers
- Comprehensive Outpatient Rehabilitation Facility
This expanded access to mental health professionals signifies CMS’s commitment to mental health and addiction treatment, recognizing them as integral components of overall health.
In addition, a 10% credit in network adequacy reviews will be awarded to Medicare Advantage plans that include telehealth providers offering additional telehealth benefits in the ‘Outpatient Behavioral Health’ category. This is intended to motivate their inclusion. This move will not only enhance access to behavioral health services but also encourage the adoption of telehealth, thus bringing mental health services closer to those who need them.
Cost-Sharing Limits for D-SNP PPOs
The Medicare Advantage landscape will also undergo a significant transformation with the introduction of cost-sharing limits for D-SNP PPOs in 2026. This policy aims to:
- Cap out-of-network cost-sharing at the same level as in-network cost sharing for professional services
- Address concerns about cost shifting to State Medicaid agencies
- Ensure fair payments for associated providers
- Reduce cost sharing for beneficiaries.
The new rule will potentially increase payments to safety net providers and reduce cost-shifting to Medicaid, thereby making healthcare more affordable for dually eligible beneficiaries. By limiting out-of-network cost-sharing for professional and acute and psychiatric inpatient services to in-network service levels, Dual Eligible Special Needs Plans (D-SNPs) look to offer a more equitable and affordable healthcare experience to beneficiaries.
Annual Health Equity Analysis of Utilization Management Policies
From 2025, an annual health equity analysis of utilization management policies will become a mandatory requirement for Medicare Advantage organizations, including those providing Medicaid services. This new requirement is an important step towards ensuring that these policies do not disproportionately impact enrollees with social risk factors, including low income, dual eligibility, or disabilities.
The analysis will encompass the following:
- Rate of prior authorization approvals
- Rate of denials
- Rate of approvals post-appeal
- Time taken for decision-making
The results of the health equity analysis will be made public, ensuring transparency and scrutiny of potential disproportionate impacts on vulnerable enrollees.
This new policy underscores CMS’s commitment to health equity and its drive to ensure that all beneficiaries, regardless of their social circumstances, have fair access to quality healthcare.
Supplemental Benefits for Chronically Ill Enrollees
The 2025 reforms also include the introduction of Special Supplemental Benefits for the Chronically Ill (SSBCI) proposals by CMS. These proposals aim to ensure that the benefits provided genuinely contribute to the health and well-being of chronically ill beneficiaries and to prevent the misuse of Medicare Advantage rebate dollars. These benefits are funded using Medicare Advantage plan rebate dollars.
The introduction of these benefits signals a shift towards a more personalized form of healthcare, where benefits are tailored to meet the unique needs of chronically ill beneficiaries. From the provision of non-medical transportation to over-the-counter drug benefits, these supplemental benefits will undoubtedly enhance the quality of care for the chronically ill, improving their health or overall function.
Yet, the introduction of these benefits is only part of the equation; it’s equally vital to ensure that beneficiaries are aware of them and make effective use of them. To that end, CMS is introducing measures to improve transparency and awareness of available benefits among beneficiaries.
Mid-Year Notification of Available Supplemental Benefits
To enhance enrollee awareness about available benefits, CMS proposes an annual issuance of a ‘Mid-Year Enrollee Notification of Unused Supplemental Benefits’ by Medicare Advantage plans. This notification would be personalized for each enrollee, indicating the supplemental benefits not used in the first half of the year and providing instructions on how to access them, along with customer service contact information.
This measure ensures that beneficiaries are well-informed about the benefits available to them and encourages the utilization of unused benefits. This not only enhances the value that beneficiaries derive from their plans but also ensures that they can access the care they need when they need it.
Expansion of the Federal Low-Income Subsidy (LIS) Program
Marking another significant development, the Federal Low-Income Subsidy (LIS) Program, which covers out-of-pocket costs for prescription medications, is being expanded by CMS. Starting in 2024, individuals earning up to $1,903 per month and couples earning up to $2,575 per month may be eligible for the LIS program, which considers a $20 income disregard from monthly unearned income.
Furthermore, LIS program beneficiaries can use a Special Enrollment Period once per quarter during the first nine months of the year to change or enroll in Part D plans, excluding the final quarter. This flexibility allows beneficiaries to select the plan that best suits their needs and financial circumstances, further enhancing the accessibility and affordability of prescription medications for low-income beneficiaries.
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Prescription Drug Reforms Affecting Family Life
Since the cost of prescription drugs poses a long-standing concern for many families, CMS has launched several key reforms to make these drugs more affordable for Medicare beneficiaries. One of these is the Medicare Prescription Payment Plan, which allows Medicare Part D beneficiaries to opt for monthly installments for their out-of-pocket prescription costs starting in 2025.
However, beneficiaries must make an active choice to opt into this plan as enrollment is not automatic. It’s also important to note that this monthly payment plan is solely for out-of-pocket prescription medication costs and does not cover premium expenses. By providing beneficiaries the option to spread out their prescription costs over the year, this plan aims to make it easier for families to budget for their healthcare expenses.
The Inflation Reduction Act further bolsters affordability measures by enabling access to no-cost vaccines for all individuals with Medicare prescription drug coverage. This move further alleviates financial burdens on families, making preventive healthcare more accessible.
Out-of-Pocket Prescription Drug Cost Caps
The Inflation Reduction Act, starting in 2025, institutes an annual limit on out-of-pocket prescription drug costs for Medicare Part D plans. Starting then, Medicare Part D enrollees will benefit from a cost cap of $2,000 on their annual out-of-pocket expenses for covered prescription drugs.
Members enrolled in the Medicare Prescription Payment Plan will have the option to make monthly payments, adhering to the $2,000 annual out-of-pocket limit. This measure aims to protect beneficiaries from the financial strain of high prescription drug costs, ensuring that they can access the medications they need without worrying about the cost.
Insulin Copay Monthly Cap
Recognizing the significant health and financial burden of diabetes on families, CMS has introduced a monthly cap of $35 on the cost of covered insulin products for Medicare Part D beneficiaries starting in 2023. The cap applies to all individual Part D-covered insulin products and across all Part B plans.
Furthermore, with Medicare Part B, beneficiaries using an insulin pump will have their monthly insulin supply costs capped at $35, and this cost is not affected by the deductible. This measure aims to make insulin more affordable for individuals with diabetes, thereby improving their health outcomes and reducing the financial burden on their families.
Smoothing Out-of-Pocket Prescription Drug Costs
From 2025, beneficiaries will have the option to spread their out-of-pocket prescription drug costs into monthly payments over the plan year, thanks to a new offering from Medicare Part D plans. Beneficiaries can voluntarily opt-in to this program, which applies only to prescription medication costs out-of-pocket and does not include premiums.
The monthly bills under this payment plan are calculated by accounting for any costs paid prior to joining the plan and dividing the remainder over the plan year. By providing a more manageable payment structure, this plan aims to lighten the financial burden of prescription drug costs on families.
Agent and Broker Compensation Regulations
CMS made a proposed rule announcement in November 2023, targeting the strengthening of regulations pertaining to agent and broker compensation for Medicare Advantage/Part D programs. The enhanced regulations are intended to prevent contracts that could disrupt an agent’s or broker’s ability to impartially determine and advocate for the Medicare plan that best meets a beneficiary’s healthcare needs.
The proposed rule aims to clarify compensation definitions, limit contract terms that encourage enrollment bias, and prohibit volume-based bonuses that could prioritize certain plans over beneficiaries’ best interests. To standardize compensation, the rule proposes fixed amounts for agent and broker payments at $632 for initial enrollments and $287 for renewals, which contrasts with the previous variable payment structure that could reach up to $601.
Impact on Traditional Medicare Beneficiaries
Traditional Medicare beneficiaries will also experience significant impacts from the forthcoming changes to Medicare. One of these changes is the introduction of expedited appeal rights for beneficiaries who are reclassified from inpatient to outpatient. This gives beneficiaries the right to an expedited appeal process if they are admitted as hospital inpatients and subsequently reclassified as outpatients.
In addition to this, CMS initiatives will enhance care coordination for traditional Medicare enrollees. These initiatives include reimbursement for providers who guide patients through their healthcare during serious illnesses and training for family caregivers to improve patient health outcomes and reduce Medicare expenses.
However, these changes also present challenges for hospitals. They will need to adapt to new systems for identifying patients eligible for appeal rights and manage financial liabilities for those staying in the hospital during the expedited appeal process.
Furthermore, the proposed Medicare reforms will introduce a look-back period for retrospective appeals, allowing beneficiaries to challenge denials of Part A hospital coverage from as far back as January 1, 2009, affecting a vast range of traditional Medicare enrollees.
Dental, Vision, and Hearing Benefits
Despite the crucial role dental, vision, and hearing care play in overall health, coverage for these services remains limited in traditional Medicare. Many beneficiaries access these services through Medicare Advantage plans, which often provide dental, vision, and hearing benefits. However, these extended benefits are limited, and not expected to bring about a significant expansion in Medicare coverage for dental care, nor a substantial rise in Medicare expenses.
Beneficiaries should carefully compare Medicare Advantage plans during open enrollment to find the one that best meets their individual dental, vision, and hearing needs, as coverage varies by plan. Although certain plans may restrict the availability of enhanced benefits to subgroups of beneficiaries, including those with specific chronic conditions, it’s important to remember that these benefits can significantly enhance the quality of care and improve health outcomes for beneficiaries.
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Summary
The upcoming changes to Family Life Medicare Supplement in 2025 signify a significant shift towards improving healthcare access and affordability for Medicare beneficiaries. From enhanced access to behavioral health services and supplemental benefits for chronically ill enrollees to significant prescription drug reforms, these changes are set to bring about an improved healthcare landscape for beneficiaries.
However, it’s important for beneficiaries and their families to stay informed and understand how these changes affect them. By doing so, they can make informed decisions about their healthcare and ensure that they are taking full advantage of the benefits available to them. The future of Medicare is evolving, and these changes represent a positive step forward in making quality healthcare more accessible and affordable for all beneficiaries.
Frequently Asked Questions
What is the US proposes reimbursement rate for Medicare Advantage 2025 payments?
The US proposes a reimbursement rate of 3.7% for Medicare Advantage 2025 payments, as stated in the recent Advance Rate Notice released by CMS (CMA Alert, Feb. 1, 2024).
What are the proposed CMS Commission changes for 2025?
CMS has proposed several changes for 2025, including a strategic redesign of Dual Eligible Special Needs Plans, expanded access to high-impact supplemental benefits, and updates to the Part D risk adjustment model to reflect the redesign of the Part D benefit. These changes aim to improve access to behavioral health care and ensure beneficiary protection from anti-competitive sales and marketing activities.
What is the Medicare Prescription Payment Plan?
The Medicare Prescription Payment Plan, starting in 2025, allows Medicare Part D beneficiaries to choose monthly installments for their out-of-pocket prescription costs.
What are the enhanced access to behavioral health services under the new changes?
Under the new changes, enhanced access to behavioral health services includes the introduction of a new facility-specialty type called “Outpatient Behavioral Health” and a 10% credit for MA plans with telehealth providers in this category. These changes aim to improve access to behavioral health services and support better care for individuals in need.
What is the annual health equity analysis of utilization management policies?
Medicare Advantage organizations must conduct an annual health equity analysis of their utilization management policies starting in 2025 to evaluate the impact of prior authorization policies on enrollees with social risk factors.
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Russell Noga is the CEO and Medicare editor of Medisupps.com. His 15 years of experience in the Medicare insurance market includes being a licensed Medicare insurance broker in all 50 states. He is frequently featured as a featured as a keynote Medicare event speaker, has authored hundreds of Medicare content pages, and hosts the very popular Medisupps.com Medicare Youtube channel. His expertise includes Medicare, Medigap insurance, Medicare Advantage plans, and Medicare Part D.